Music Royalties for Adult Entertainment Clubs

Summary#

Copyright Board published SOCAN Tariff 3.C – Adult Entertainment Clubs (2026-2028). It sets a per-capacity daily fee of 6.71¢ per day for the use of recorded music in adult entertainment clubs and requires yearly reporting and reconciliation by January 31.

What it does#

• Sets the royalty rate at 6.71¢ per day multiplied by the club’s authorized capacity (seating and standing) for the period 2026 to 2028.
• Defines a “day” as the period between 6:00 a.m. on one day and 6:00 a.m. the next day during which the establishment operates as an adult entertainment club.
• Requires users to file an estimated report and pay the estimate to SOCAN by January 31 of the year covered by the tariff.
• Requires a final report and reconciliation with SOCAN by January 31 of the following year showing authorized capacity and number of days operated; additional amounts must be paid or overpayments credited.
• Says late payments carry interest calculated daily at 1% above the Bank Rate published by the Bank of Canada, and interest does not compound.
• Gives SOCAN the right to audit a user’s books and records on reasonable notice.
• Includes confidentiality rules but allows sharing of information with service providers, Re:Sound, the Copyright Board, and in certain legal or distribution-related situations.

Who's affected#

• Owners and operators of adult entertainment clubs in Canada that play recorded music.
• Establishments whose capacity is set by a liquor licence or similar document, since the fee is multiplied by that authorized capacity.
• Accounting and management staff who must prepare the required reports and payments.
• It is not clear from the notice whether any other types of venues are covered; the tariff names adult entertainment clubs specifically.

Why it matters#

• Clubs can now calculate a predictable music royalty cost: 6.71¢ per day per authorized seat/standing space for each day they operate as an adult entertainment club.
• The tariff adds yearly administrative steps (estimates, final reports, and possible audits) that affect club bookkeeping.
• Late payments will incur interest, so timely reporting and payment matters financially.
• Operators may choose to adjust prices or other costs to cover the new royalty expense.